Most Australians set and forget their home loan. But the mortgage market moves constantly — and the loan you took out 3 years ago may be significantly more expensive than what’s available today.
Here are 5 clear signs it’s time to pick up the phone and get a rate review.
Sign 1: Your Interest Rate Starts With a Number Higher Than the Market
This sounds obvious, but many borrowers genuinely don’t know what their current rate is — they just pay whatever direct debit comes out each month.
Check your rate on your most recent statement. Then compare it with current rates available in the market. If you’re paying 0.5% or more above what new borrowers are getting, you’re paying what’s sometimes called the ‘loyalty tax’ — the premium long-term borrowers pay for not shopping around.
On a $600,000 loan, 0.5% difference is approximately $3,000 per year — or $60,000 over a 20-year term.
Use our Mortgage Repayments Calculator to see exactly how much a lower rate would save you each month.
📅 Repayment Calculator
Sign 2: Your Fixed Rate Period Is About to Expire
When a fixed rate period ends, most borrowers roll onto their lender’s standard variable rate — which is often one of their highest rates. This is called the ‘revert rate’, and it’s frequently 0.5%–1.5% above the market’s best variable rates.
Start reviewing your options at least 3 months before your fixed rate expires. This gives you time to compare the market, get approval, and settle a new loan before the revert rate kicks in.
Before you decide whether to re-fix or go variable, read our breakdown of fixed vs variable rate home loans — it covers exactly what to weigh up when your term ends.
Sign 3: Your Property Has Increased in Value
If your property has grown in value since you purchased, your LVR (Loan-to-Value Ratio) has improved. This can unlock:
Access to lower-rate loan tiers (many lenders offer better rates at <80% or <70% LVR)
The ability to refinance without paying LMI
Access to equity for renovations, investment property deposits, or other goals
Even a modest increase in property value can have a meaningful impact on what lenders will offer you. A broker can order a desktop valuation to assess your current LVR position before you apply.
Sign 4: Your Financial Situation Has Improved
Got a promotion? Paid off a car loan? Credit score improved? Your financial profile directly influences the rates and products lenders will offer you.
Many borrowers who struggled to qualify for competitive rates when they first purchased are now in a much stronger position. Refinancing at this point can deliver significant savings — and may also allow you to restructure your loan features (add an offset account, for example) to match your current needs.
| 💡 If you’ve been in your current job for 2+ years, paid your loan consistently, and reduced other debts, you’re in a stronger position than when you first applied. |
|---|
Sign 5: Your Loan No Longer Suits Your Life
Your circumstances change. Maybe you want to:
Access an offset account to reduce interest while keeping savings accessible
Make extra repayments to pay the loan off faster
Access equity to fund a renovation or investment
Consolidate credit card or personal loan debt into your mortgage
Switch from P&I to interest-only (or vice versa) as your financial priorities shift
If your current loan doesn’t accommodate these goals, refinancing can restructure everything to suit where you are now — not where you were when you first bought.
What to Do Next
Check your current rate on your most recent statement
Compare it with current market rates for your LVR
Calculate the potential saving over 12 months
Factor in refinancing costs (usually $500–$1,500 for an owner-occupier)
If the saving exceeds the cost — speak to a broker
Ready to take action? Our step-by-step refinancing guide walks you through every stage of the process — from checking your current loan position to settling the new one.
Frequently Asked Questions
Savings vary based on loan size, rate difference and remaining term. On a $600,000 loan, saving 0.5% equates to approximately $3,000 per year. A broker can model the exact numbers for your situation.
Typically 4–6 weeks from application to settlement. If you start the process 3 months before your fixed rate expires, you’ll have plenty of time.
Yes — this is called a rate review or retention negotiation. Call your lender’s retention team (not general customer service) and quote competitor rates. Some lenders will match or beat market rates to keep your business. If they won’t, refinancing is the answer.
A single refinance application creates one credit enquiry — a minor, short-term impact. The long-term benefit of a lower-cost loan generally outweighs this.
Leave a Reply